Hungary's OTP Bank Buys Raiffeisen Ukraine For 650 Million Euros

BUDAPEST, Hungary -- Hungarian bank OTP has announced that it has acquired the seventh-biggest Ukrainian bank, Raiffeisen Ukraine (RBUA), for 650 million euros ($832 million).

The OTP logo on the main office of the Hungarian commercial bank in Budapest.
Under the deal, signed in Vienna and announced late on Thursday, OTP is to acquire 100 percent of RBUA which is a subsidiary of Austrian company Raiffeisen International Bank-Holding AG.

OTP said in a statement: "The purchase price is based on RBUA's current and potential value and on the favourable growth potential of the Ukrainian banking market."

OTP said it expected to close the deal by September, after receiving approval from the Ukrainian government.

RBUA had a 3.6-percent market share of the Ukrainian market in 2005, with 1.2 billion euros in total assets and a pre-tax profit of 39.7 million euros last year.

The acquisition is part of an aggressive expansion strategy by OTP in central and eastern Europe.

The Hungarian bank already has affiliates in Bulgaria, Croatia, Romania and Slovakia.

"Following the acquisition of Raiffeisenbank Ukraine, OTP Bank wants to further strengthen its positions via acquisitions, besides organic growth in Ukraine," OTP said.

OTP, with total assets of 18.0 billion euros in end-2005, had a pre-tax profit of 38.3 billion forint (146.3 million euros) last year.

Source: AFP